Advocacy

Key State Talking Points

Legislative

Small Dollar Loans by Payday Lenders

(Opposed) H.B. 4004 has been introduced by Rep. Matt Hall and it would allow payday lenders to offer installment loans for as much as $2,500 for up to one year, with a monthly service fee that equates to triple digit APR at 132%. This rate is far in excess of what is allowed under Michigan usury laws, and for products offered by traditional financial institutions or under the Military Lending Act. While the bill purports to have some consumer protections, the legislation still allows the high-priced loan to be refinanced by another small loan, and a lender could loan to a borrower that has an outstanding small loan or payday loan from another provider, still leaving the window open for cyclical renewals on products that are difficult for vulnerable borrowers to pay back. Many credit unions offer alternative products and services to help borrowers avoid these types of loans, provide free financial counseling, and will work with members in their individual situations when they need help. From emergency loan products, to skip a pay and other solutions, invariably a credit union will be able to offer a much lower-cost solution for a borrower with acute financial needs. The MCUL opposes HB 4004 and encourages legislators to explore meaningful and non-predatory solutions to address the need for additional financial products in the market.

Data/Cyber Security and Privacy

(Support) Massive data breaches at the national and state levels continue to impact hundreds of thousands of credit union members. Michigan credit unions continue to bear the costs of these breaches. While credit unions have been subject to strict federal privacy requirements since 1999, merchants have not been held to the same data standards. Inaction on data breach protections at the federal level has led to MCUL seeking a state solution. Senator Wayne Schmidt has introduced SB 672 this bill would provide protections for businesses that adhere to industry data/cyber security standards through giving them an affirmative defense were they to be sued as a result of a data breach as long as they are following industry cyber/data security standards. This legislation had an initial hearing in January in Senate Energy and Technology committee and was voted out of the Senate in March. The legislation was referred to the House Financial Services committee and is awaiting a hearing.

Financial Education Legislation

(Support) This session Representative Diana Farrington introduced HB 5190 which would require all students take a credit class of financial education prior to graduating from High School. Credit unions have long been supportive of financial education and overall financial wellbeing for all Michiganders. This legislation was signed by the Governor and is now PA 105 of 2022.

Regulatory

Electronic Lien Termination

On March 16, 2021, the Michigan Department of State (MDOS) will allow for the electronic exchange of lien and title information with lienholders in lieu of paper certificates of title. All financial institutions will be required to participate in this program. Our team was able to have MDOS do a walk through of what the program looks like and were able to have the MDOS team answer some questions on the program and implementation. To view this presentation please click here. For additional information from MDOS on how to participate please review the below document entitled ELT Information for Financial Institutions.

April 23 Q&A Session on ELT with SOS

Lienholder e-Services Overview

TR-11 Information for ELT Implementation

ELT Information for Financial Institutions